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Energy Tomorrow is brought to you by the American Petroleum Institute (API), which is the only national trade association that represents all aspects of America's oil and natural gas industry. Our more than 500 corporate members, from the largest major oil company to the smallest of independents, come from all segments of the industry. They are producers, refiners, suppliers, pipeline operators and marine transporters, as well as service and supply companies that support all segments of the industry.

Wall Street Journal (subscription publication): The U.S. could soon export more energy than it imports, significantly changing the country’s appetite for foreign fuels starting as early as 2020, according to a new report from the Energy Information Administration.

Despite energy prices that are sharply lower today than they were a year ago, the federal government’s new outlook forecasts that U.S. oil and natural gas production will continue to rise over the next five years.

As American drillers keep pumping, the U.S. will meet more of its own energy needs. The trend will also boost the amount of natural gas, refined fuels such as diesel and ultralight oil the U.S. has available to ship overseas, reversing the country’s energy importing trend that has been in place since the 1950s.

The U.S. Energy Information Administration’s (EIA) new Annual Energy Outlook for 2015 contains a number of stats, charts and projections, but you could boil them down to a couple of important points.

First, oil and natural gas are and will continue to be the foundation of an all-of-the-above energy approach that’s key to continued U.S. economic growth, energy security and overall security. EIA says oil (36 percent) and natural gas (27 percent) supply 63 percent of America’s energy now, and EIA projects they will supply 62 percent in 2040 (oil 33 percent and natural gas 29 percent). This is because oil and natural gas are high in energy content, portable and reliable. They’re the workhorse fuels of the broader economy, making modern living possible as fuels and as the building blocks for a number of products Americans depend on every day. America is and will be dependent on a variety of energies, but oil and natural gas are and will play leading roles.

The great news is the U.S. is in the midst of a revolution in domestic oil and natural gas production, leading to a second big takeaway from EIA’s report – that domestic output is and will continue to reduce U.S. dependence on imported energy.

Production of crude (including lease condensate) increased during 2014 by 1.2 million barrels per day to 8.7 million barrels/day. EIA says that on a percentage basis 2014’s output increased 16.2 percent, the highest growth rate since 1940.

Falling crude oil imports is a good-news story for the United States – indicative of greater U.S. energy self-sufficiency, resulting in less dependency on others and increased American energy security in the world.
According to the U.S. Energy Information Administration (EIA), net imports of crude fell by more than 2.7 million barrels per day (bbl/d) from 2008 to 2014:

During his State of the Union speech President Obama talked about expanding trade and building up the middle class. Both good objectives. And, while a president’s annual message to Congress usually is full of goals that are mostly aspirational, both of these are attainable – through energy.

First, the president could work to end the ban on the export of domestic crude oil, a relic of the 1970s and an era of U.S. energy scarcity. A supply of light sweet crude, mismatched for a refinery sector largely configured to handle heavier crudes, would be able to reach overseas markets. This would help support domestic production and jobs – many of them well-paying middle-class jobs – while benefitting our trade balance.

Both would increase the U.S. presence in global energy markets – expanding world supply, helping allies and strengthening American foreign policy – all consistent with our country’s status as an energy superpower.

Second and more specifically, the president could approve the Keystone XL pipeline. It’s needed energy infrastructure that would bring more than 800,000 barrels of oil a day from Canada and the U.S. Midwest, support tens of thousands of U.S. jobs – good middle-class jobs – and help strengthen the U.S. energy/trading relationship with Canada, our No. 1 source of imported oil.

Wall Street Journal: The U.S. trade gap narrowed in November to its lowest level in nearly a year, reflecting gyrations in the oil market that mask strong underlying domestic demand for foreign goods.
The trade deficit fell 7.7% to a seasonally adjusted $39 billion in November from the prior month’s deficit of $42.25 billion, the Commerce Department said Wednesday. The reading marks the smallest deficit since December 2013. October’s deficit was revised from an initially reported $43.43 billion.
The narrower trade gap could support fourth-quarter economic growth. Barclays lifted it forecast fourth-quarter gross domestic product forecast to a 3.5% gain from a 2.7% advance following the trade report. Credit Suisse moved its estimate to a 3.2% advance from 2.9%.

The Week: One of the biggest stories of 2014 has been the astonishing drop in global oil prices. The price of the benchmark Brent crude went from over $100 per barrel at the beginning of the year to the $60 range as of this writing.

It's worth noting how massive and completely unexpected this price drop has been.

And it's worth noting how good it is for the U.S. economy. The price of oil is one of the biggest drags on consumer demand, the largest driver of the economy.

“It is a dramatic boon to fuel consumers. (Gasoline) is a modest portion of our giant gross domestic product and yet it does have a pervasive and festive benefit to motorists.”

During this season of gift-giving and receiving, Americans should give thanks for the gifts of plentiful domestic oil and natural gas, modern technologies to harness them and an industry robust and innovative enough to bring the two together, resulting in surging, home-grown production. Indeed, the dramatic increase in U.S. oil production is the key addition to global supply that’s putting downward pressure on the cost of crude, the No. 1 factor in pump prices.

Dallas Business Journal: So far this year, the U.S. has imported 369.8 million barrels of crude oil, according to the Energy Information Administration. Sure, that sounds like a lot, especially in light of the shale boom renaissance that has swept the country.
Until you look at the past few years.
For the same period in 2010, the U.S. imported 456.1 million barrels of crude, according to the EIA. So, in four years, oil imports have declined 19 percent and will likely continue to decrease in future years.

Deliveries slid 653,000 barrels a day to 1.68 million in the week ended June 6, the fewest for the period since 1999, the Energy Information Administration data showed today. The 28 percent drop was the biggest decline since the week ended June 18, 2013. Fuel imports peaked at 4.97 million barrels a day in October 2005.

“There’s a change in the dynamic,” said Phil Flynn, a senior market analyst at Price Futures Group in Chicago. “We’re not going to stop importing products but the overall number should move lower. We’re turning into a hub where products are both imported and exported based on price.”

Shipments to the U.S. from abroad have dropped as the shale boom provided refiners with an ample supply of cheaper domestic crude to make fuel. West Texas Intermediate, the U.S. benchmark crude, has traded at an average discount of $12 to Brent oil from the North Sea over the past four years. WTI traded at an average premium of more than $1 to the European grade from 1988 to 2008.

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